Transitioning to a Perfect Virtual Business Partnership

In the wake of healthcare reform, the Department of Health & Human Services (HHS) created a transitions of care implementation and evaluation plan. The Joint Commission has created an entire transitions of care portal to guide healthcare organizations through the operational improvement process. It is rare to see big government so interested in the nitty-gritty of hospital management at this level of detail; but their interest reflects the degree of potential benefit in improving information gathering and sharing during the transitions of care.

HHS foresees the improvement of transitions of care, defined as the movement of patients between various healthcare settings, and predicts that in the future this will play a big role in improving patient safety and cost savings. HHS is clearly anticipating that many different hospital departments and physician specialties within the hospital will become ‘virtual business partners’ as patients segue from one area to another. Benefits that will accrue to all stakeholders from smoothing the movement of patients among departments include the increased sharing of risk, which, in turn, restrains costs; as well as a more dynamic system in which each service builds on the success of the others.

It is striking to see how many thought leaders and government entities are currently working on capitalizing on the transitions of care challenge. Eric Coleman, MD, gives some ideas as how to ensure high quality transitions of care. He notes the importance of exploring technological solutions and defining accountability during transitions. From a broader perspective, he writes that “transitional care further exposes one of the greatest weaknesses of our healthcare system – namely that it is not in fact a system.” This is a significant point, and I have a feeling that ten years from now we will look back and be shocked to see the disorganization in the state of technology use in the hospital, as well as the changes in the hospital culture that have resulted from increased departmental collaboration.

This departmental coordination in the transitions of care model is analogous to what Adam Smith predicted for the economy when he wrote about “perfect competition” back in the 18th century and how “the invisible hand” would push prices towards market value. In Smith’s case, local manufacturers had more information about the actual cost of production and their ability to set their own prices and passed this information on to the market in general. In today’s hospital, the invisible hand is not as much concerned with pricing output as it is in sharing the cost of gathering critical information about risk and care.

In the theory of “perfect competition” there is no market entity powerful enough to set a price, just as in the Acute Care Continuum participants work in a collaborative setting without a singular powerful entity setting the complete cycle of patient care. Furthermore, the integrated nature of a continuum takes on a self regulating aspect that Adam Smith described as an “invisible hand”. The traditional structure of physicians and departments working within their own silos and following their own self interests is being integrated into a more broadly shared collective interest in the management of patient care from admission to discharge to 30 days post discharge. This is creating a market based movement towards a smoother and more efficient pathway through the hospital. Achieving excellence and expertise in transitions of care within a real healthcare system is key to the success of this movement.

Improvements in this business partnership within the transitions of care can harness market forces within the hospital for the benefit of the patient and for those who pay the cost of patient care. It will create economies of scale as the whole system becomes more integrated, and perhaps most of all, facilitate the sharing of medical information and knowledge.

Who would think so much lies in a transition? The US Federal Government certainly thinks so, and I think Adam Smith would have anticipated the force and power of this coming together as well.

“Every patient, every shift, every site.” This may sound like something Vince Lombardi would have said if he had worked in a hospital rather than on a football field; however, it is a message very appropriate... ...

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